Author: DLNews

Translation: Deep Tide TechFlow

Deep Tide Overview: America's largest cryptocurrency exchange Coinbase announced a 14% workforce reduction. CEO Brian Armstrong publicly stated that AI allows engineers to complete in days what used to take weeks for teams, and non-technical teams can also write code for deployment. Wall Street voted with their feet: stocks jumped 4% in early trading. Behind this wave of layoffs is the evaporation of $1.5 trillion from the cryptocurrency market since its peak, as well as a collective experiment by tech companies to restructure their organizations using AI.

Coinbase just laid off 700 people, but Wall Street is buying it.

This flagship American cryptocurrency exchange saw its stock price rise 4% in early trading on Tuesday, prior to the company announcing a 14% workforce reduction as part of a major reorganization that shifts its focus towards artificial intelligence.

In an email to employees, CEO Brian Armstrong highlighted two major pressures: the market has evaporated approximately $1.5 trillion from its peak, and AI.

"Over the past year, I have watched engineers complete in days what used to take teams weeks to accomplish using AI," Armstrong wrote in the email, which he later reposted on X. "Non-technical teams can now write code for deployment, and many of our workflows are being automated."

"We are fundamentally changing the way we operate: rebuilding Coinbase into an intelligent entity, with humans at the margins responsible for aligning it," he added.

According to the 2025 financial report, as of December 31 last year, Coinbase had 4,951 employees. Based on this figure, a 14% layoff would affect 693 people.

This move places Coinbase alongside Meta and Microsoft — Meta is laying off about 10%, and Microsoft is reducing its workforce through a voluntary retirement plan. Many high-flying tech companies offer similar reasons.

Coinbase expects to incur restructuring costs of between $50 million and $60 million, most of which will be accounted for in the second quarter. Early market reactions show that investors view this as a long-overdue adjustment.

Armstrong stated that he wants no more than five layers of management below the CEO level, with leaders directly managing at most 15 people, along with what he calls "AI-native squads" — small and focused teams where one person can simultaneously serve as engineer, designer, and product manager.

"The future belongs to small, high-context teams that can act quickly," he said.

Familiar Script

This is not the first time Coinbase has wielded the axe.

Since its launch in 2012, the exchange has laid off employees during every crypto winter, highlighting how dependent its fate is on Bitcoin prices and the sentiment of the cryptocurrency market.

This downturn is particularly harsh. Bitcoin is still down 35% from its peak of $126,000 on October 12, 2025, while the S&P 500 index reached an all-time high in April during the same period.

"We are proactively adjusting in advance, rebuilding Coinbase to be more streamlined," Armstrong said.